Rising diesel prices put RTCs on the downward journey

The four road transport corporations (RTCs) providing transportation to crores of people every day are worried about the rise in the diesel prices at a time when their cumulative losses since 2013-14 have crossed Rs 2,200 crore.

The RTCs, including Bangalore Metro Rail Corporation Limited (BMTC) and Karnataka Road Transport Corporation (KSRTC), are bleeding money ever since the hike in employee salaries in 2016. Hike in fuel prices, last year, further worsened the financial situation of the corporations.

Of the two road transport corporations in north Karnataka, North West Karnataka Road Transport Corporation (NWKRTC) has posted a loss of Rs 140 crore last year, pushing its total losses to nearly Rs 500 crore.

Karnataka Road Transport Corporation, the parent entity, that showed promise with a profit of Rs 4.5 crore in 2017-18, also suffered with the numbers turning negative last year with Rs 431 crore loss.

With oil prices climbing every day after the attack on the world’s largest oil exporter Saudi Aramco, last week, senior officials have expressed concerns that the downward slide will take them to new lows by the end of the year. Diesel price has increased by Rs 1.7 over the last one week, which has seen a daily upward revision of 20-30 paise.

“These small slips will accumulate to become huge burdens as the corporations have no prospect of seeing a rise in the revenue to offset the losses. All the four corporations have sought to hike the fares but the government has put a break on the proposals fearing negative publicity,” a senior official in Karnataka Road Transport Corporation said.

Experts in the mobility sector have warned that fare hike will not only inconvenience the passengers and force them to shift to cheaper two-wheelers, but would also add to congestion on the roads.

BMTC has hit rock bottom with cumulative losses of Rs 1040.48 crore with officials stating that the corporation has not recovered from the jolt it received since the salary revision in 2016.

“For a corporation that posted a loss of Rs 349.5 crore for 2018-19, the government grant of Rs 100 crore was of no help. What is needed is nothing less than a bailout,” a senior official said. Deputy Chief Minister Laxman Savadi, who holds Transport portfolio, could not be reached despite repeated attempts.